More bad banks.

Exactly one week ago I wrote in this space about the exposure by the Parliamentary Committee on Banking Standards of the “dishonest or delusional” management that led to the failure of HBOS in 2008, and I concluded by asking, Any more? There certainly are -- plenty. Already this week Standard Charter, Barclays, Northern Rock and HSBC have been found guilty of, or have admitted to, bad and even criminal practice. Also, three City traders have been arrested in connection with the Barclays Libor-fixing scandal. The biggest case is that of HSBC which has been fined US$1.9 billion for money laundering and sanctions-busting by US regulators -- a serious blow to the reputation of Britain's biggest bank if only a tap on the wrist in money terms. HSBC handled more than seven billion dollars of banknotes from Mexico that were almost certainly connected to the drugs trade. Standard Charter paid 327 million dollars to US regulators to settle allegations that it had breached US sanctions against Iran. It is the habit of today's bank managements to point out that these offences occurred several years ago and that new measures to guard against them are now in place. But is that a good enough excuse? Can we be sure that often unwritten ethical and moral standards are now always observed? Is government or City oversight thorough enough to prevent renewed transgressions?